July 12th, 2011
Inspired by Public Sector Job Cuts Threaten Recovery (U.S. News & World Report 7/08/11), Welcome to the anti-stimulus (Ezra Klein, WashingtonPost.com 10/08/10), and the President’s discussion of the issue in his press conference today. Of the $862 billion in the 2009 stimulus bill, $288 billion was in the form of tax cuts, and $135 billion was aid to state and local governments to keep them from having to layoff public sector workers. This money is now gone, and the layoffs have started. A debt ceiling deal should provide for this funding to continue in order to avoid further layoffs.
” When I came into office and budgets were hemorrhaging at the state level, part of the Recovery Act was giving states help so they wouldn’t have to lay off teachers, police officers, firefighters. As we’ve seen that federal support for states diminish, you’ve seen the biggest job losses in the public sector — teachers, police officers, firefighters losing their jobs.” — Barack Obama at7/11/11 press conference
“The magnitude of the stimulus funding for states–$135 billion–while not fully addressing their budget gaps, has played a key role in the relative credit stability of the state sector through fiscal 2010, we believe. This money has also softened the impact of state funding reductions for local governments in many states. The end of the American Recovery and Reinvestment Act of 2009 (ARRA) will bring new challenges for state and local governments.” – Standard & Poor’s
Almost half a million state and local government jobs have been lost.
State and local governments are balancing their budgets, but at what social and economic cost?
Economists project up to a million more lost state and local jobs over the next fiscal year,
Which will cause economic harm that force them to be even more austere.
That will bring the total of lost state and local jobs to 1.5 million,
All because Republicans don’t want to tax people who make more than a million.
Ex-state and local workers will be more than 10% of the total number of people unemployed,
A prospect about which even Teabaggers should not be overjoyed.
If the economy were booming, these folks could quickly find a job if the private sector,
But given that private firms aren’t hiring, they instead face long-term unemployment’s specter.
How much will states save when they all start collection unemployment compensation,
And how much more will state and local revenues drop because of their lack of taxation?
Nor are these unnecessary “Big Government” workers, as the Tea Party depicts:
State and local employment are at their lowest levels since 2006.
They’re police officers, firefighters, garbage collectors,
Teachers, nurses, and food safety inspectors.
Does it make sense for them all to be fired
And then when the economy’s better, (hopefully) rehired?
Of course, the economy will have a hard time getting stronger
If state and local layoffs make the recession last longer.
Politicians, like doctors, should first do no harm,
Which is whyAmericans should view this trend with alarm.
More funding would keep states and localities from losing a million more employees,
So Republicans, please consider that – and Mr. President, press harder, please.
Here’s Fox News’3/04/11 report on state and local government job loss – even they thing the situation is dire, and we’ve had three more months of big drops since then. Commentator Al Lewis makes the excellent point that it’s not unions’ or over-spending’s fault, it’s the recession that has dramatically reduced state and local tax revenues.
Update: As reported in State, local job loss menaces US recovery-analysts (Reuters 8/05/11), after 39 thousand more state and local government worker jobs lost in July, state and local worker job loss is now over half a million workers (503 thousand to be exact), which according to Moody’s increases our chance of a double-dip recession to 25-50%.